The government and the ruling Saenuri Party have agreed to raise the minimum wage and begun preparations to discuss the legislation with opposition parties.

“We will put in our utmost effort to find common ground between the ruling and opposing parties over the minimum wage increase,” Saenuri Party floor leader Rep. Yoo Seong-min said in the party’s supreme council meeting Thursday.

Yoo’s remarks came after Finance Minister Choi Kyung-hwan, who also serves as deputy prime minister, stressed the need to raise the minimum wage to boost sagging domestic consumption and avoid deflation risks.

The current minimum wage per hour is 5,580 won ($5.07), an increase of 370 won from 2014.

“The working class may welcome falling prices, but inflation in February contracted when excluding the effect of the cigarette price hike,” Choi said, suggesting that higher wages would boost consumer sentiment.

Rep. Yoo expressed regret over Choi’s failure to have a pre-consultation with the ruling party on the issue, but he said the Saenuri Party supports his views on the minimum wage hike.

“The shift in views can be a way of warding off the country’s deflation threats, as well as reducing the socioeconomic polarization and the low-income population.”

Yoo also pointed out that Choi’s blueprint resonates with the U.S. New Deal in 1933-1937. In response to the Great Depression, the program endorsed the rapid increase of the minimum wage to boost demand.

Discussions over the scope of the hike will be furthered in Friday’s conference with the government, he added.

In response, the main opposition New Politics Alliance for Democracy welcomed the ruling party’s change of stance on the minimum wage agenda.

NPAD chief policymaker Rep. Kang Gi-jung said Choi’s remarks are in unison with the opposition party’s call for income-backed economic growth.

But the NPAD lawmaker urged that the government and the ruling Saenuri Party would have to follow through all the way to legislation for actual change.

By Chung Joo-won (joowonc@heraldcorp.com)